MB Real Estate has released the 2nd Quarter 2012 Chicago Market Overview, a quarterly report that tracks trends, analyzes data, and provides you with our forecast for the Chicago CBD and Suburban office markets.
CBD Highlights:
- Occupancy
increased by 105,000 square feet. Improved demand for Class A and B
buildings was muted by weakened demand for Class C.
- Direct
vacancy fell 10 basis points to 15.7 percent. Google is in advanced
negotiations to bring a 500,000 square foot new requirement to the CBD.
- At the end
of this year, Hines plans to break ground on a 45-story, 900,000 square
foot tower at 444 West Lake.
- A slow
recovery is expected as new job announcements compete against tenants
eliminating underutilized space.
Suburban Highlights:
- Occupancy
increased by 509,000 square feet as each submarket experienced positive
net absorption.
- Direct
vacancy fell 50 basis points, but remained at a significantly high 23.0
percent.
- Class A
asking rental rates are down 3.1 percent year-over-year, which has likely
contributed to positive net absorption.
- Speculative
construction is, and will remain, at a standstill.
- Vacancy is
expected to remain elevated in the near term as the Suburbs lack the
demand drivers seen in the CBD.
